Reddit is a great place to share ideas and opinions with like-minded individuals, but is it the best place to receive financial advice? You may be surprised how many people use Reddit’s personal finance Canada forum to find ways to navigate their debt problems.
There are a few reasons why people turn to Reddit for financial advice. You can receive advice anonymously and discuss your financial situation with others in similar circumstances. But it’s important to remember that while these people may empathize with your situation, it is unlikely that they are licensed professionals or can offer long term help.
With this in mind, you may benefit from seeking advice from a Licensed Insolvency Trustee (LIT). An LIT is a debt management expert who can help you deal with financial problems. With their support, you can decide on the best route forward to manage your debt and work towards becoming debt free.
Confidential and sympathetic advice
If you’re fearful of discussing your financial situation with others who may share your personal information, an LIT can put your worries at ease. When consulting with an LIT, you’ll be reassured that they will not share your details or information. You can confidently share your complete financial situation without fearing your friends or family will find out. They will offer you unbiased advice with no judgment and have seen many others in a situation similar to yours.
LITs are the only federally-regulated debt advisors in Canada, licensed by the Office of the Superintendent of Bankruptcy. This means they are experts in all areas of debt management, from credit counselling to Bankruptcy, and they can deal with your creditors on your behalf.
There are individuals and companies out there that may claim to be money and debt experts that can help ease your financial struggles. Be aware that they may get a commission for referring you to credit counselling or if you sign up for something they recommend.
The terms “financial advisor” and “financial planner” are used broadly throughout Canada, and just because someone may call themselves a financial advisor this doesn’t mean they have specific qualifications or expertise. Consulting with an LIT can give you the reassurance that you’re working with a professional who is licensed by the federal government.
Objective advice and regulated fees
LITs have a legal and ethical obligation to provide you with objective advice. Their fees are also regulated so you know your Trustee is not benefiting financially from their advice. They are required by law to be paid from your Bankruptcy or Consumer Proposal funds, and not from you personally. Your initial consultation will also be free of charge, so you can decide if working with an LIT is the right option for your situation, without paying for the service.
Range of options
Your financial problems don’t need to be at a point where you can’t pay your bills before you can receive support from a LIT. They’re experts in money management and debt, and the earlier you reach out for help, the more options you will have available to you. Below are options that an LIT will discuss with you:
1. Credit counselling
LITs are trained credit counsellors. Credit counselling can help you work through your money troubles and determine a manageable path forward with check-ins along the way. Your LIT will review your income, assets and regular expenses as well as your credit score and help you devise a long term debt management plan. With their advice, you can put life-long, healthy financial habits in place.
2. Consolidate your debt
Debt consolidation may help you to manage your debt. It involves you taking out a new, larger loan to pay off a number of smaller loans, debts or bills that you’re currently making repayments on. This means you are essentially combining all your individual loans into one, with one monthly repayment with the possibility of paying a lower interest rate. As you’re combining several loans into one payment, this can be a way for you to better manage several debt repayments.
3. Filing a Consumer Proposal
If you’re at a point where you can’t make your debt payments, a Consumer Proposal may suit your situation. A Consumer Proposal is a legally-binding agreement to help reduce the amount that you owe to your creditors. The aim is to significantly reduce your monthly debt payments over a repayment period, usually up to five years. As long as your debts don’t exceed $250,000, a Consumer Proposal may suit you.
4. Personal Bankruptcy
Personal Bankruptcy is a legal process governed by the Bankruptcy & Insolvency Act. It is an option that will settle your debts when they feel impossible to manage. When you file for Bankruptcy, you will receive an automatic stay of proceedings, meaning your unsecured creditors must stop all collection actions. Your creditors will also stop any wage garnishment. Once you’ve been discharged from your Bankruptcy, you will be debt free.
Ready to say goodbye to your debt?
You will receive better advice from a professional as opposed to relying on an online forum. The first step is to reach out for a free initial consultation. Our Licensed Insolvency Trustees are experts in all areas of debt management. They are here to offer support and advice to help you move towards financial wellbeing. Contact us today and begin your journey towards a brighter financial future.